WATER AND SANITATION BUSINESS

Transcription

1 WATER AND SANITATION BUSINESS The Roles and Responsibilities of Local Government and Related Institutions

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3 Contents Preface...1 PURPOSE OF THIS BOOKLET...3 What is meant by Water Services?...3 PART 1: LEGISLATION WHICH IMPACTS ON WATER SERVICES...4 Local Government: Municipal Structures Act (Act 117 of 1998)...4 Local Government Municipal Systems Act (Act 32 of 2000)...4 The Municipal Systems Act (Act 32 of 2000)...6 The Division of Revenue Act (enacted annually)...6 Local Government: Municipal Finance Management Act (Act 56 of 2003)...6 PART 2: LEGISLATIVE FRAMEWORK FOR WATER AND SANITATION...8 Water Services Act (Act 108 of 1997)...8 National Water Act (Act 36 of 1997)...8 PART 3: WATER SECTOR INSTITUTIONS...10 Water Services Institutions...10 Water Resource Management Institutions...12 PART 4: THE ROLE OF WATER SECTOR INSTITUTIONS IN THE WATER AND SANITATION BUSINESS CYCLE...14 Who is responsible for each of these components?...14 PART 5: THE RECOVERY OF COSTS IN THE WATER AND SANITATION BUSINESS CYCLE...18 Costs associated with protecting the raw water source...18 The Water and Sanitation Business Wall Chart Costs associated with the raw water supply...21 Costs associated with bulk water treatment and bulk potable distribution...22 Costs associated with municipal water supply infrastructure...23 Costs associated with municipal sewage collection and treatment...24 PART 6: PLANNING FOR THE DIFFERENT COMPONENTS OF THE WATER CYCLE...25 LEGISLATIVE ROLES AND RESPONSIBILITIES OF THE KEY WATER SERVICES INSTITUTIONS..25 PART 7: WATER SERVICES AUTHORITY...26 Ensuring Access...27 Regulating: Bylaws and Monitoring...27 Planning: Water Services Development Plans...28 Deciding Water Services Provider mechanisms...30 PART 8: WATER SERVICES PROVIDER...32 Duties and Functions of Water Services Providers...32 Provide Information...32 Conditions for Provision of Water Services...32 Provision Functions...33 SUMMARY OVERVIEW...35 CONCLUSION...36 Appendix 1 Responsibilities of the Minister of Water Affairs and Forestry in Terms of the Water Services Act Compulsory National Standards Relating to Water Services...36 Norms and Standards for Tariffs...37 Regulations: Contracts between Water Services Authorities and Water Services Providers...37 Monitoring and Intervention...37 National Information System...37 Contact Details

4 Purpose of this booklet The purpose of this booklet is to inform municipalities (both councillors and officials) of: the different water sector institutions provided for by the Water Services Act (108 of 1997) and the National Water Act (36 of 1998) how the different water sector institutions link to the water and sanitation business cycle and the associated costs the legislative roles and responsibilities of the different water sector institutions, in particular the water services authority and the water services provider This booklet is an information booklet, which highlights legislative requirements and institutional responsibilities. It is not meant as a replacement for the actual Acts and is not a policy document. Whilst this booklet refers to the National Water Act and various water resource management institutions to illustrate the linkages between water resource management and water services, the emphasis is on the Water Services Act, water supply and sanitation services, and the Water Services Institutions. There are separate booklets on the National Water Act and Water Resource Management Institutions, which can be obtained from the Department of Water Affairs and Forestry. What is meant by Water Services? Water services means both water supply services and sanitation services. Wherever the Act and this booklet refer to water services, the implications for sanitation must also be addressed. 3

5 PART 1: Legislation which impacts on water services There are various key pieces of local government legislation, which have an impact on water services, notably: the Municipal Structures Act the Municipal Systems Act the Municipal Finance Management Act In addition the Division of Revenue Act has a bearing on water services. These Acts are briefly discussed below. The Constitution of the Republic of South Africa Act 108 of 1996 The Constitution vests the executive authority for water services in local government. One of the objectives of local government is to ensure the provision of services to communities in a sustainable manner. Local Government: Municipal Structures Act (Act 117 of 1998) This Act, known as the Structures Act, deals with the following matters: It sets up the basis for the establishment of municipalities in the A (Metropolitan Municipalities), B (Local Municipalities) and C (District Municipalities) categories. It defines the way municipalities are established. It establishes the way councils are to function, including committees and mayoral options. It determines the division of powers and functions between municipalities who have concurrent jurisdiction. The Structures Act gives district municipalities the powers and functions necessary to perform the water services authority function as contained in the Water Services Act. The Minister of Provincial and Local Government may however authorise a local municipality, after consultation, to be a water services authority. 4

6 Effective from July 2003, the Minister published a list of authorisations. This meant that in some cases the power and function for water services shifted from district municipalities to local municipalities. In other cases where local municipalities had fulfilled the water services authority role, the power and function shifted to the district municipality. Where there was a shift in power and function for water services, the staff, assets and liabilities predominantly associated with water services delivery automatically became vested, by law, in the authorised municipality. The transfer of staff and assets was generally regulated by the "section 12 notices" (authorisation notices). Although there may still be ad hoc boundary demarcations, and shifts in powers and functions, it is generally accepted that the transformation of local government has now stabilised. This means that water services authorities can now focus on their water services powers and functions towards ensuring effective, affordable and sustainable water services delivery. Local Government Municipal Systems Act (Act 32 of 2000) This Act focuses on the internal systems and administration of a municipality. It covers various matters including: Public accountability and community involvement in policy formulation and decision making Guidelines for making bylaws Establishing Integrated Development Plans Establishing a performance management system Delivering municipal services Credit control and debt collection Key issues impacting on water services are summarised below: Authority / provider differentiation The Act introduces the differentiation between authority and provider functions of a municipality, by providing that a municipality may deliver services itself, or by way of an external mechanism by entering into a service deliver agreement. This makes it consistent with the Water Services Act which specifically defines a water services authority and a water services provider, and distinguishes the constitutional obligation to ensure services delivery, but not necessarily to provide it. Municipal Service Partnerships The Act identifies the importance of alternative mechanisms for providing municipal services. The Act distinguishes between internal and external mechanisms. It obliges a municipality to first consider internal mechanisms (a department, business unit or other mechanism) before it examines external mechanisms for the delivery of municipal services. If a municipality wants to deliver services through an external mechanism, it has to undertake a feasibility study and assess affordability as well as get the views of the community. The Act further sets out certain requirements for contracting with others. This applies to a water services authority contracting a water services provider to fulfil the water services provision function. If the water services authority chooses a public sector partner, it is not obliged to follow a competitive tendering process. Institutional options The Act introduces a range of institutional forms that may be utilised for the delivery of municipal services, such as municipal entities which include multi-jurisdictional service utilities and service utilities, established by bylaw. These institutional options may be applied to the delivery of water services, as appropriate. 5

7 Local Government: Municipal Finance Management Act (Act 56 of 2003) The objective of his Act is to ensure sound and sustainable management of the financial affairs of municipalities. It covers various matters for both municipalities and municipal entities including: Managing revenue and debt Budgeting Responsibilities of mayors and municipal officials Procurement (supply chain management and PPPs) Reporting Intervention in the instance of financial problems The duty to provide free basic water needs to be balanced against the duty to ensure sustainable service delivery. The Municipal Finance Management Act provides the mechanisms for ensuring affordable service delivery (budgets) and for regulating financial performance. This Act is intended to complement the Systems Act which regulates credit control and debt collection, and decision making about service delivery mechanisms. The Act also regulates partnerships and associated reporting obligations on municipalities. The Division of Revenue Act (enacted annually) The Division of Revenue Act, which is enacted annually, gives effect to Section 214(1) of the Constitution of the Republic of South Africa, 1996 (108 of 1996). The Constitution requires an Act of Parliament to provide for the equitable division of nationally raised revenue among the three spheres of government. The Act contains various schedules, which set out: the respective equitable shares in respect of national, provincial and local spheres of government the respective shares of each province other allocations, including conditional grants, unconditional grants and indirect transfers, as well as the condition they are subject to. All local government infrastructure grant funding is now consolidated into the Municipal Infrastructure Grant which is aimed at assisting the poor to gain access to infrastructure. MIG funds can only be used for infrastructure for basic levels of service. 6

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9 PART 2: Legislative framework for water and sanitation The Water Services Act (108 of 1997) and the National Water Act (36 of 1998) provide the legislative framework within which water supply and sanitation services and water use need to take place. A process is underway to change the Water Services Act to align it to the Strategic Framework for Water Services and other legislation applicable to the water sector. Water Services Act (108 of 1997) Purpose Legislates the municipal function of providing water supply and sanitation services National Water Act (36 of 1998) Purpose Legislates the way that the water resource (surface and ground water) is protected, used, developed, conserved, managed and controlled. The overall objective of the Water Services Act is to assist municipalities to undertake their role as water services authorities, and to look after the interests of consumers. It is also to clarify the role of other water services institutions, especially water services providers and water boards. It is in terms of this Act that a municipality obtains use of the water that it requires for distribution to its consumers. This Act also governs how a municipality may return effluent and other waste water back to the water resource. 8

10 Water Services Act Mandate Gets its mandate from (amongst others) Section 27 of the Bill of Rights in the Constitution. Section 27of the Constitution provides, amongst other rights, that everyone has the right to have access to sufficient food and water and that the state must take reasonable legislative and other measures within its available resources, to achieve the progressive realisation of each of these rights. National Water Act Mandate Gets its mandate from (amongst others) Section 24 of the Bill of Rights in the Constitution that states that everyone has the right to an environment that is not harmful to their health or well being; and to have the environment protected for the benefit of present and future generations through reasonable legislative and other measures that: prevent pollution and ecological degradation; promote conservation; and secure ecologically sustainable development and use of natural resources while promoting justifiable economic and social development. The main objects of the Water Services Act are to provide for: the right of access to basic water supply and to basic sanitation; the setting of national standards and norms and standards for tariffs; the preparation of water services development plans; a regulatory framework for water services institutions; the establishment of water boards and water services committees; the monitoring of water supply and sanitation services; intervention by the Minister or by the relevant Province; financial assistance to water services institutions; a national information system; the accountability of water services providers; and the promotion of effective water resource management and conservation. The purpose of the National Water Act is to ensure that the nation s water resources are protected, used, developed, conserved, managed and controlled in ways which take the following into account: meeting the basic human needs; promoting equitable access to water; redressing the results of past racial and gender discrimination; promoting the efficient, sustainable and beneficial use of water; facilitating social and economic development; providing for growing demand for water use; protecting aquatic and associated ecosystems; reducing and preventing pollution and degradation of water resources; meeting international obligations; promoting dam safety; managing floods and droughts; and establishing suitable institutions and to ensure that they have appropriate community, racial and gender representation. 9

11 PART 3: Water sector institutions Water Services Authority Both the Water Services Act and the National Water Act provide for different types of institutions. The Water Services Act provides for water services institutions, whilst the National Water Act provides for water management institutions. Brief descriptions of each institution are provided below. The more detailed legislative roles and responsibilities of the different institutions are provided later in this booklet. Water Services Institutions One of the most important elements of the Water Services Act is that it provides for the institutional arrangements for water services provision. It sets out who is responsible for different activities. A water services authority is any municipality that has executive authority for water services within its area of jurisdiction in terms of the Municipal Structures Act or the ministerial authorisations made in terms of the Municipal Structures Act. This means that the municipality is responsible for ensuring access to water supply and sanitation services. A water services authority is a municipality and cannot be any other type of institution. The water services authority can be a Category A (Metropolitan), or Category C (District) municipality, or a Category B (Local) municipality, if authorised by the Minister of Provincial and Local Government. A water services authority has a choice. It may carry out the functions of a water services provider itself or it may enter into a contract (service delivery agreement) with another water services provider. 10

12 Water Services Provider Water Board The water services provider physically provides the water supply and sanitation services to consumers under contract to the water services authority. This function can be performed by the municipality itself or any other public or private body, such as a water board, a non-governmental organisation (NGO), a community-based organisation (CBO) or a private sector company, with whom it contracts. No person may operate as a water services provider without the approval of the water services authority or by means of a contract/service delivery agreement. A water board is established by the Minister of Water Affairs and Forestry. The primary function of a water board is to provide water services to other water services institutions. Water boards may carry out secondary activities as long as they do not interfere with its primary function of supplying other institutions, or create financial problems for the board. Secondary activities of a water board may include: - providing management services, training and other support services - supplying untreated water to end users who do not use the water for household purposes - providing catchment management services - with the approval of the water services authority: - supplying water directly for industrial use - accepting industrial effluent - acting as a water services provider to consumers - performing water conservation functions. A water board is a public water services provider. 11

13 Water Services Intermediary The institution that is of most relevance to water services authorities is the catchment management agency. Water user associations are mainly established to provide water to the agricultural sector and are briefly mentioned below. Bodies responsible for international water management are established to co-ordinate activities with neighbouring countries. Although not a water services institution, the Water Services Act provides for a water services intermediary. A water services intermediary is a person or body which provides water to people as a part of some other contract. For example a farmer who provides water to farm labourers, landlords of flats who provide water to tenants, or a mine who provides water to people living in company housing and hostels. The definition of a water services intermediary within the Water Services Act makes it clear that a water services intermediary only applies where water supply is a specific part of the contract between the two parties, namely that there is an obligation to provide water services by the one party to the other. Water Resource Management Institutions The National Water Act provides for four different types of water management institutions: catchment management agency water user association a body responsible for international water management any person who fulfils the functions of a water management institution in terms of the Act Catchment Management Agency The national government is the public trustee of the nation s water resources. The purpose of establishing catchment management agencies (CMAs) is for national government to delegate water resource management to the catchment level, and to involve local communities. The aim is to establish catchment management agencies for all water management areas. There are 19 water management areas covering the entire country. A water management area is an area of responsibility of a single catchment management agency. The Minister, acting through the DWAF regional offices, will act as the catchment management agency in water management areas where catchment management agencies have not been established, or where they do not function properly. The initial functions of a catchment management agency are to: investigate and advise on the protection, use, development, 12

14 conservation, management and control of the water resources in its water management area develop a catchment management strategy co-ordinate the activities of water users and of the water management institutions promote the implementation of any applicable water services development plan promote community participation DWAF will, over time delegate other functions to catchment management agencies which in the long term will result in catchment management agencies authorising water use. Water User Association Although water user associations are water management institutions their primary purpose, unlike catchment management agencies, is not broad resource water management. They operate at a restricted localised level, and are particularly tailored for the management of local water resource infrastructure, with an emphasis on agricultural and other rural users. As such, they provide a vehicle for local water resource infrastructure management where there are no other relevant organisations. Whilst the primary function of water user associations is to operate infrastructure for their members, water user associations may provide bulk water services on behalf of a municipality, i.e. fulfil the function of bulk water services provider. For example, this may be the case where there is no water board and where the water user association has the capacity to provide bulk water services. Water user associations are cooperative associations of individual water users who wish to undertake water-related activities for their mutual benefit. 13

15 PART 4: The role of water sector institutions in the water and sanitation business cycle The water and sanitation business cycle comprises a number of separate components, which are all linked into one business cycle. The components are illustrated in the diagram below. Protection, development, management and control of use of raw water (surface and ground water) Storing raw water in dams Waste water and effluent collection and treatment and returning the treated effluent back to the river Water and Sanitation Business Cycle Raw water abstraction, bulk water treatment (purification) and bulk potable water Reticulation of water to the consumers Who is responsible for each of these components? 14

16 Protection, development, management and control of use of raw water (surface and ground water) Department of Water Affairs and Forestry Catchment Management Agency The Minister of Water Affairs and Forestry sets the national objectives for protecting the resource in the national water resource strategy. Each catchment management agency is then responsible for protecting the catchments and aquifers within their water management areas in accordance with the national water resource strategy. Protection of a water resource, means: to maintain the quality of surface and ground water so that it can be used in an ecologically sustainable way to prevent degradation of the river or aquifer to rehabilitate the river or aquifer In order to protect the national water resource, the resource needs to be developed, managed, and conserved. In addition, protection of the resource requires control of use from the resource and control of activities within the resource - for example controlling abstraction from the resource and controlling the return of effluent and disposal of waste to the resource. Storing raw water in the dams Department of Water Affairs and Forestry The national government is the public trustee of the nation s water resources. In many cases the national Department of Water Affairs and Forestry has taken the initiative to develop, operate and maintain the inter-basin transfer schemes and the storage dams used to store the raw water. But, any institution (or person) can construct and operate a dam if that institution has a licence or other authorisation to do so. 15

17 Raw water abstraction, bulk water treatment (purification) and bulk potable water distribution Bulk Water Services Provider Water Board Bulk water services providers are responsible for developing, operating and maintaining abstraction works and bulk potable infrastructure, such as bulk water treatment plants and pump stations, and reservoirs and pipelines for distributing bulk potable water to the municipal reservoirs. In terms of bulk potable water, the municipality can either fulfil this function itself, or it can contract a bulk water services provider (who may also be the water services provider responsible for developing, operating and maintaining the municipal reticulation infrastructure). In areas where a water board exists, the water board will usually fulfil the role of bulk water services provider. The primary function of water boards is provide water services to other water services institutions. If a water board fulfils the role of bulk water services provider, it must have a contract with the relevant municipality (water services authority). Reticulation of water to the consumers Water Services Authority Water Services Provider The water services authority (municipality) is responsible for ensuring that infrastructure is developed, operated and maintained. It may perform the functions of a water services provider itself (i.e. it may develop, operate and maintain the infrastructure, manage revenue collection and customer relations, and promote health and hygiene awareness itself), or it may contract another water services provider to carry out this function on its behalf. 16

18 Municipal infrastructure comprises the municipal reservoirs, pump stations and pipelines used to reticulate the water to the consumer. The duty of the water services authority to ensure efficient, affordable, economical and sustainable access to water services is subject to: the availability of resources the need for an equitable allocation of resources the need to regulate access to water services in an equitable way the duty of consumers to pay reasonable charges the duty to conserve water resources the nature, topography, zoning and situation of the land in question Waste water and effluent collection and treatment and returning the treated effluent back to the river Water Services Authority Water Services Provider The water services authority is responsible for collection and treatment of sewage, waste water and effluent. It may perform this function itself, or it may contract a water services provider to carry out this function on its behalf. Municipal sewage and waste water treatment infrastructure comprises the sewerage pipes and sewerage treatment plants used to collect sewage, waste water and other effluent and to treat it before returning the treated water back into the river or sea. Section 7 of the Water Services Act states that no person may obtain water for industrial use or dispose of the industrial effluent from any other source other than the distribution system of a water services provider, or its nominated agency, without the permission of that water services authority. All industries are therefore firstly required to discharge waste to the water services provider s treatment works. Water services providers should take extra care, at all times, to ensure that the effluent received is treatable and that the water treatment works will comply to the set effluent standards. Water services providers can however give permission that effluent be treated by another party, or be treated on site. 17

19 PART 5: The recovery of costs in the water and sanitation business cycle Costs are incurred during each phase of the water and sanitation business cycle. COSTS ASSOCIATED WITH PROTECTING THE RAW WATER SOURCE Catchment Management Agency Protection, development, management and control of use of raw water (surface and ground water) WATER RESOURCE MANAGEMENT CHARGE The catchment management agency incurs costs in protecting and managing the resource. It costs money to: evaluate and issue licences monitor water resource quality against the water resource objectives detect and prosecute unlawful use promote water conservation and demand management etc. These costs are recovered by the catchment management agency from the users (those that abstract raw water from the river or aquifer or those that discharge waste water or treated effluent back into the river) in the form of a water resource management charge. 18

20 The Water and Sanitation Business Wall Chart 519

21 Francois Smit

22 COSTS ASSOCIATED WITH THE RAW WATER SUPPLY Department of Water Affairs and Forestry Storing raw water in the dams RAW WATER TARIFF It costs money to: develop (construct) the inter-basin transfer schemes, dams, and other infrastructure required to store and supply the raw water from the source repay the loans (and interest) required to finance the construction operate these works (including electricity and labour) maintain these works The Department of Water Affairs and Forestry (or raw water supplier) charges a water resource development and use of water works charge to cover the costs of developing, financing, operating and maintaining and refurbishing the raw water abstraction and storage works. This charge is added to the Water Resource Management Charge (charged by the catchment management agency) and the total costs are passed on to the bulk water services provider / user as a Raw Water Tariff. The amount of the raw water tariff is determined by the input costs and may differ between catchments in a single water management area (area of responsibility of a CMA) and may even differ from scheme to scheme in the same catchment. It is important to note that a user is only charged the water resource development and use of water works charge if they receive their raw water from the Department of Water Affairs or another raw water supplier s water works. If, for example, a user abstracts ground water, the user is charged the water resource management charge, but not the water resource development and use of water works charge. 21

23 COSTS ASSOCIATED WITH BULK WATER TREATMENT AND BULK POTABLE DISTRIBUTION Bulk Water Services Provider Raw water abstraction, bulk water treatment (purification) and bulk potable water distribution BULK POTABLE WATER TARIFF It costs money to: purchase the raw water from DWAF or the institution responsible for storing the raw water (raw water tariff) develop (construct) the abstraction works, bulk water treatment plant, the bulk reservoirs, pump stations and pipelines required to abstract and purify the raw water and distribute the potable bulk water to the municipal reservoirs repay the loans (and interest) required to finance the construction operate these works (including chemicals, electricity and labour) maintain these works These costs are recovered from the water services authority or water services provider by the bulk water services provider in the form of a bulk potable water tariff, which includes the raw water tariff. 22

24 COSTS ASSOCIATED WITH MUNICIPAL WATER SUPPLY INFRASTRUCTURE Water Services Authority / Provider Reticulation of water to the consumers MUNICIPAL WATER TARIFF It costs money to: purchase the bulk potable water from the institution responsible for abstracting, purifying and distributing the bulk potable water (bulk water tariff which includes the raw water tariff) develop (construct) the municipal water supply infrastructure comprising the municipal reservoirs, pump stations and pipelines used to reticulate the water to the consumer repay the loans (and interest) required to finance the construction operate these works (including electricity and labour) maintain these works to read the meters and bill the customers These costs are recovered from the consumer by the water services authority in the form of a municipal water tariff, which includes the bulk water tariff. 23

25 COSTS ASSOCIATED WITH MUNICIPAL SEWAGE COLLECTION AND TREATMENT Water Services Authority / Provider Waste water and effluent collection and treatment and returning the treated effluent back to the river MUNICIPAL SANITATION TARIFF It costs money to: pay the water resource management charge associated with discharging treated effluent back into the river develop (construct) the municipal sewage collection and treatment infrastructure comprising the municipal sewers, sewage pump stations and sewage treatment plants used to collect the sewage, effluent and waste water from the consumer and to treat it repay the loans (and interest) required to finance the construction operate these works (including chemicals, electricity and labour) maintain these works promote health, hygiene and sanitation monitor health impacts and periodically evaluate the effectiveness of the sanitation promotion create and enabling environment for the construction of household and public toilet facilities bill the customers These costs are recovered from the consumer by the water services authority or water services provider in the form of a municipal sanitation tariff which includes the water resource management charge (if any) applicable to discharging effluent. This tariff is sometimes included in the municipal water tariff. It should be noted that because of all these costs, full water borne sanitation is far more expensive than on-site systems, such as a septic tank, aquaprivy or VIP. However, costs such as health and hygiene promotion and pit emptying also apply to on-site systems. 24

26 PART 6: Planning for the different components of the water cycle As shown above, various components of the water cycle are managed by different institutions. Furthermore, each component has large financial implications and it may take a number of years to progressively develop the institutions envisaged by the Acts. For example, no catchment management agencies have yet been established. This indicates that there is a considerable need for sound planning to ensure that all components of the cycle are co-ordinated. It is for this reason that the Acts prescribe that each of the institutions should compile formal plans. The National Water Act requires the Minster to compile a national water resource strategy and each catchment management agency to compile a catchment management strategy. The Water Services Act requires each water board to compile a water board business plan, and every water services authority to compile a water services development plan. Furthermore, the Act specifies the minimum contents of each of these plans. Planning between the different institutions must be co-ordinated. For example when a catchment management agency prepares its catchment management strategy (which includes an allocation plan for allocating water to existing and prospective users), the catchment management agency needs to take into account the water requirements of water services authorities in the water management area. These requirements are specified in the water services authorities water services development plans. Likewise when preparing the water services development plan, water services authorities must ensure that there is sufficient water available in the catchment management strategy. The water services development plan is the most relevant to municipal councillors and officials. The requirements of this plan are detailed under the legislative roles and responsibilities of a water services authority in part 7 below. LEGISLATIVE ROLES AND RESPONSIBILITIES OF THE KEY WATER SERVICES INSTITUTIONS The Minister s responsibilities in terms of the Water Services Act are included as Appendix 1. The next two parts describe the more detailed legislative roles and responsibilities of the water services authority and the water services provider. These parts are particularly relevant to municipalities in terms of water supply and sanitation services. 25

27 PART 7: Water services authority The Water Services Act provides that every water services authority must: ensure access to efficient, affordable, economical and sustainable access to water services for all consumers; make bylaws; prepare a water services development plan; and decide on appropriate mechanism for providing water services, i.e. either perform the function of water services provider itself (internal mechanism) or contract a water services provider (external mechanism). These legislative functions can be divided into two key areas: Water Services Authority Governance Provision Ensuring Access Regulating (bylaws) Planning (WSDP) Providing (WSP function) Deciding water services provider mechanism/s 26

28 The Governance Functions cannot be delegated to any other legal entity, however, the water services authority can contract in support to assist with various governance functions. If the water services authority also performs the water services provider (provision functions), the governance functions must be managed and accounted separately from the provision functions. The Provision Function is the actual provision of the water supply and sanitation services to consumers, for example operating and maintaining the water services infrastructure, customer relations, revenue collection, etc. The Municipal Systems Act introduces the differentiation between authority (governance) and provider functions of a municipality, which makes it consistent with the Water Services Act. Ensuring Access Every water services authority has a duty to all consumers or potential consumers in its area of jurisdiction to progressively ensure efficient, affordable, economical and sustainable access to water services. This duty to ensure access to services is subject to: the availability of resources; the need for an equitable allocation of resources; the need to regulate access to water services in an equitable way; the duty of consumers to pay reasonable charges; the duty to conserve water resources; and the nature, topography, zoning and situation of the land in question. The authority has the right to limit or discontinue the provision of water services if there is a failure to comply with reasonable conditions set for the provision of such services, and may also impose reasonable limitations on the use of water services. Water Services Authorities also need to develop water services policies such as a free basic water policy and policies related to equitable share and the channeling of grants. These policies must be integrated and consistent with other municipal service policies. Whilst policy development is not required by legislation, it is required in order to develop by laws and for the performance of other functions. Ensuring access is also ensuring that the necessary water services infrastructure is in place. This requires accessing grants and implementing capital projects. All projects must be identified in the water services development plan. Regulating: Bylaws and Monitoring Every water services authority must make bylaws which contain conditions for the provision of water services, and which must provide for at least: the standard of the services; the technical conditions of supply; the installation, alteration, operation, protection and inspection of water services works and consumer installations; the determination and structure of tariffs; the payment and collection of money due for the water services; the circumstances under which water services may be limited or discontinued; the procedure for discontinuing and limiting services; the prevention of unlawful connections to water services works; and the unlawful or wasteful use of water. Bylaws must comply with national standards. Part of the regulatory function is monitoring the provision of water services and taking 27

29 corrective action where required. This requires setting up a regulatory system in the water services authority. Planning: Water Services Development Plans A water services authorities must prepare a draft water services development plan (WSDP) for its area of jurisdiction, as part of the Integrated Development Plan (IDP) process. The WSDP is a tool to assist water services authorities to make informed decisions about water and sanitation services, and to plan for those communities that do not have access to basic services. The planning process involves: data collection and analysis; stakeholder participation; strategic decision making; project identification and prioritisation; and commitments in terms of actions and resources required to implement the WSDP. The water services development plan must contain details about: the physical attributes of the area; the size and distribution of the population; a time frame for the plan, including the implementation programme for the following five years; existing water services; existing industrial water use; existing industrial effluent disposed of; the number and location of persons who are not being provided with a basic water supply and basic sanitation; water services providers which will provide the water services; contracts and proposed contracts with water services providers; proposed infrastructure necessary; the water sources to be used and the quantity of water to be obtained from and discharged into each source; the estimated capital and operating costs of those water services; financial arrangements for funding those water services, including the tariff structures; any water services institution that will assist the water services authority; the operation, maintenance, repair and replacement of existing and future infrastructure; the number and location of persons to whom water services cannot be provided within the next five years, setting out the reasons; and the time frame within which it may reasonably be expected that a basic water supply and basic sanitation will be provided to those persons; and of existing and proposed water conservation, recycling and environmental protection measures 28

30 In developing the water services development plan the water services authority must at all times be conscious of the requirements of Section 5 of the Water Services Act which states that: if the water services provided by a water services institution are unable to meet the requirements of all its existing consumers, it must give preference to the provision of basic water supply and basic sanitation to them. The Strategic Framework for Water Services (2003), provides definitions of basic water supply and basic sanitation as follows, (the changes to the Water Services Act will also reflect these definitions): basic water supply service means the provision of a basic water supply facility, the sustainable operation of the facility (available for at least 350 days per year and not interrupted for more than 48 consecutive hours per incident) and the communication of good water-use, hygiene and related practices. (A basic water supply facility is defined as the infrastructure necessary to provide 25 litres of potable water per person per day within 200 metres of a household and with a minimum flow of 10 litres per minute.) basic sanitation service means.the provision of a basic sanitation facility which is easily accessible to a household, the sustainable operation of the facility, including the safe removal of human waste and wastewater from the premises where this is appropriate and necessary, and the communication of good sanitation, hygiene and related practices. (A basic sanitation facility is defined as the infrastructure necessary to provide a sanitation service which is safe, reliable, private, protected from weather, ventilated, keeps smells to the minimum, is easy to keep clean, minimises the risk of the spread of disease carrying flies and pests, and enables safe and appropriate treatment and /or removal of human water and wastewater in an environmentally sound manner.) Provision Municipality fulfils the water services provider function itself Municipality enters into an agreement to fulfil the water services provider functions Direct Delivery Delivery through a Municipal Service Partnership 29

31 These definitions are made more specific in terms of quantity and quality in the Regulations published by the Minister under Section 9 of the Water Services Act. The Department of Water Affairs and Forestry has prepared guidelines to assist municipalities in compiling a water services development plan. Deciding Water Services Provider Mechanism/s The water services authority is responsible for deciding the most appropriate service delivery mechanism for the provision of water supply and sanitation services. It has a choice, to either provide the services itself (internal mechanism), or to select and appoint another water services provider/s to provide water services within its area of jurisdiction (external mechanism). An internal mechanism includes any arrangement where the municipality fulfils the water services provider function itself. This could be: a department or an administrative unit within the municipality s administration a business unit an internal municipal service district If the municipality chooses to establish or contract another entity to fulfil the water services provider function, this is called an external mechanism. An external mechanism includes: a municipal entity another municipality an organ of state a community-based organisation a non-governmental organisation any other institution or entity legally competent to operate a business activity Summary of internal and external delivery agreements Internal mechanisms External mechanisms WSA Municipality fulfils the water services provider function itself (Inside the municipality) Service delivery agreement Municipality enters into a service delivery agreement to fulfil the water services provider functions (Outside the municipality) Department or administrative unit Business unit Any other component of municipality s administration Another municipality Municipal entity Organ of State CBO NGO Any other institution 30

32 The process to assess, select and appoint a service delivery mechanism is regulated by Chapter 8 of the Municipal Systems Act. This Chapter also specifies that a competitive tendering process is required if a CBO, NGO or private entity is to be appointed as a municipal services provider. According to Section 19(2) of the Water Services Act, a water services authority may only enter into a contract with a private sector water services provider after it has considered all known public sector water services providers which are willing and able to perform the relevant functions. What is a Municipal Service Partnership? A municipal service partnership is a contractual arrangement for the delivery of municipal services. The services delivery agreement (contract) is between the water services authority and another body or organisation that will fulfil the water services provider functions. There are different types of contracts (services delivery agreementsthat a water services authority can enter into with a water services provider. These include: service contract management contract lease BOT Concession or a combination of contract types The type of contract will depend upon the type of resources and services that the water services authority aims to access through the municipal services partnership, and will depend upon allocation of risk between the water services authority and water services provider. As soon a service delivery agreement has been concluded with a water services provider, the water services authority must supply a copy thereof to the relevant Province (Provincial MEC for Local Government) and to the Minister of Water Affairs and Forestry. The implementation of selected service delivery mechanisms is regulated by the Municipal Systems Act, the Municipal Finance Management Act and the Water Services Act. 31

33 PART 8: Water services provider The water services provider physically provides the services. Duties and Functions of Water Services Providers The Water Services Act requires the following of the water services provider: Every water services provider must be contracted to act as a provider; A water services provider must provide information when required to do so Every water services provider must set conditions for provision of water services. The Municipal Systems Act requires that a municipal services provider must have a service delivery agreement with the municipality. In the case of a water service provider, this service delivery agreement is regulated in terms the Section 19(5) Regulations issued by the Department of Water Affairs and Forestry. Provide Information A water services provider must give such information concerning the provision of water services as may reasonably be called for by: the water services authority; the relevant Province; the Minister of Water Affairs and Forestry; or a consumer or potential consumer. Conditions for Provision of Water Services Every water services provider must set conditions for the provision of water services. These conditions must be in accordance with the conditions contained in the bylaws made by the water services authority having jurisdiction in the area in question. The conditions must provide for: the technical conditions of existing or proposed extensions of supply; the determination and structure of tariffs; the conditions for payment; the circumstances under which water services may be limited or discontinued; procedures for limiting or discontinuing water services; and measures to promote water conservation and demand management. Procedures for the limitation or discontinuation of water services must: be fair and equitable; with a few exceptions, provide for reasonable notice of intention to limit or discontinue water services; and provide for an opportunity to make representations and not result in a person being denied access to basic water services for non-payment, where that person proves, to the satisfaction of the relevant water services authority, that he or she is unable to pay for basic services. 32

34 The Section 19 Regulations require a model consumer charter to be published by the water services provider. It must be developed in consultation with consumers, and must contain the conditions for the provision of water services. Provision Functions The contract with the water services provider will determine the provision functions that must be performed by the water services provider. It is important to note that water services provision is not simply about operating and maintaining water services infrastructure; it is also about providing an efficient, affordable, reliable and sustainable service to consumers. Provision functions include the following: Daily Operations Daily operations refers to operating the scheme. The nature of the operations activity will vary depending upon the technology of the water services infrastructure. Daily operations includes monitoring the water services infrastructure and minor repairs. Maintenance This refers to normal repairs as well as preventative maintenance and major maintenance required to maintain the water services infrastructure. In terms of sanitation this function includes: ensuring that on-site latrines are desludged as necessary management and maintenance of sewered systems safe treatment and disposal of sludge, sewage and effluent Customer Relations and Communication The relationship between the water services provider and customers is very important. The water services provider must provide customers with the services that have been agreed upon in a way which satisfies customer requirments. Customer relations includes: two way communication with consumers and keeping them informed arrangements for dealing with complaints finding out customer needs and problems and responding to those needs Health and Hygiene Promotion Health and hygiene promotion covers a number of activities, including: Creating demand for better sanitation in communities through programmes which raise awareness about why sanitation is important Providing consumers with information about a range of sanitation options and involving them in the choice of the system they prefer Promoting health awareness and safe hygiene practice Providing users with information about their toilets to ensure they are well maintained Monitoring the impact of health and hygiene programmes, and making improvements where necessary. 33